Blossom Inc. manufactures two products: car wheels and truck wheels. To determine the amount of overhead to assign to eachproduct line, the controller, Daniel Jackson, has developed the following information:CarTruckEstimated wheels produced49,00019,000Direct labour hours per wheel24Total estimated overhead costs for the two product lines are $870,000.(a)Calculate the overhead cost assigned to the car wheels and truck wheels, assuming that direct labour hours are used to allocateoverhead costs.Car wheelsSA$S

First, we need to calculate the total direct labour hours for both car wheels and truck wheels. This…

Answered: Blossom Inc. manufactures two products:…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Beerfield Company manufactures product M in its factory. Production of M requires 2 pounds of material P, costing $10 per pound and 0.5 hour of direct labor costing, $16 per hour. The variable overhead rate is $14 per direct labor hour, and the fixed overhead rate is $18 per direct labor hour. What is the standard product cost for product M? Direct material Answer Direct labor Answer Variable overhead Answer Fixed overhead Answer Standard product cost per unit Answer
Altex Inc. manufactures two products: car wheels and truck wheels. To determine the amount of overhead to assign to each product line, the controller, Robert Hermann, has developed the following information. Estimated wheels produced Direct labor hours per wheel (al) Your answer is correct. Overhead rate $ eTextbook and Media (a2) Total estimated overhead costs for the two product lines are $752,600. Car Car wheels 41,000 Calculate overhead rate. (Round answer to 2 decimal places, eg 12.25) $ 1 Truck wheels $ Truck 10,000 3 Compute the overhead cost assigned to the car wheels and truck wheels, assuming that direct labor hours is used to allocate overhead costs. 10.60 per direct labor hour Attempts: 1 of 5 used
Vaughn Company manufactures two products, Mini A and Maxi B. Vaughn's overhead costs consist of setting up machines- $890,000; machining- $2,030,000; and inspecting- $640,000. Information on the two products is: Mini A Мaxi В Direct labour hours 14,000 26,000 Machine setups 700 500 Machine hours 21,000 23,000 Inspections 700 600 Overhead applied to Maxi B using traditional costing and direct labour hours is
The Ramapo Company produces two products, Blinks and Dinks. They are manufactured in two departments, Fabrication and Assembly. Data for the products and departments are listed below. Product Number of Units Labor HoursPer Unit Machine HoursPer Unit Blinks 1,033 4 4 Dinks 1,864 7 8 All of the machine hours take place in the Fabrication department, which has an estimated overhead of $111,400. All of the labor hours take place in the Assembly department, which has an estimated total overhead of $109,600. The Ramapo Company uses a single overhead rate to apply all overhead costs based on labor hours. What is the overhead cost per unit for Dinks? a.$72.02
Greenwood Company manufactures two products—15,000 units of Product Y and 7,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z: Activity Cost Pool Activity Measure Estimated Overhead Cost Expected Activity Machining Machine-hours $ 231,000 11,000 MHs Machine setups Number of setups $ 180,000 300 setups Production design Number of products $ 94,000 2 products General factory Direct labor-hours $ 260,000 10,000 DLHs Activity Measure Product Y Product Z Machining 9,000 2,000 Number of setups 60 240 Number of products 1 1 Direct labor-hours 9,000 1,000 4. What is the activity rate for the Machine Setups activity cost pool?
Aileen Co manufactures two components, L and M. Both components are manufactured on the machine ZX. The following cost information per unit of L and M is available: Direct material Direct labour Variable overhead Fixed overhead Total cost L M ($) ($) 12 18 25 15 8 7 6 46 10 55 Component L requires three hours on machine ZX and component M requires five hours. Manufacturing requirements show a need for 1,500 units of each component per week. The maximum number of machine ZX hours available per week is 10,000. An external supplier has offered to supply Aileen Co with the components for a price of $57 per component L and $55 per component M. Identify, by clicking on the relevant boxes in the table below, whether each of the following statements are true or false. would be cheaper for Aileen Co to produce all the components in-house if the hours on machine ZX were available Aileen Co should purchase 400 units of component M from the external supplier TRUE TRUE FALSE FALSE
Tri-bikes manufactures two different levels of bicycles: the Standard and the Extreme. The total overhead of $300,000 has traditionally been allocated by direct labor hours, with 150,000 hours for the Standard and 50,000 hours for the Extreme. After analyzing and assigning costs to two cost pools, it was determined that machine hours is estimated to have $200,000 of overhead, with 4,000 hours used on the Standard product and 1,000 hours used on the Extreme product. It was also estimated that the setup cost pool would have $100,000 of overhead, with 1,000 hours for the Standard and 1,500 hours for the Extreme. Required: Calculate the amount of overhead assigned per product, under traditional and under ABC costing.
Rundle Company produces commercial gardening equipment. Since production is highly automated, the company allocates its overhead costs to product lines using activity-based costing. The costs and cost drivers associated with the four overhead activity co pools follow: Cost Cost driver Req A and B Unit Level $ 25,200 Req C a. Allocated cost b. Allocated cost Production of 880 sets of cutting shears, one of the company's 20 products, took 130 labor hours and 10 setups and consumed 15 percent of the product-sustaining activities. Required 8. Had the company used labor hours as a companywide allocation base, how much overhead would it have allocated to the cutting shears? Complete this question by entering your answers in the tabs below. 1,200 labor hours b. How much overhead is allocated to the cutting shears using activity-based costing? c. Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 880…
Gable Company uses three activity pools. Each pool has a cost driver. Information for Gable Company follows: Total Cost of Pool $ 454,960 100,000 72,720 Estimated Cost Driver 96,800 10,000 505 Activity Pools Machining Designing costs Setup costs Suppose that Gable Company manufactures three products, A, B, and C. Information about these products follows: Product A Product B 38,000 4,000 40 Number of machine hours Number of design hours Number of batches Cost Driver Number of machine hours Number of design hours Number of batches Product A Product B Product C Total Overhead Assigned 48,000 2,200 170 Required: Using activity rates, determine the amount of overhead assigned to each product. Note: Do not round intermediate calculations. Round the final answer to nearest whole number. Product C 10,800 3,800 295
Lynwood, Inc. produces two different products (Product A and Product X) using two different activities: Machining, which uses machine hours as an activity driver, and Inspection, which uses number of batches as an activity driver. The activity rate for Machining is $180 per machine hour, and the activity rate for Inspection is $580 per batch. The activity drivers are used as follows: Product A: (machine hours= 1,200) (number of batches 55) Product X: (mahine hours= 3,200) (number of batches 18) Totals: (Machine hours= 4,400) (number of batches 73) What is the amount of Machining cost assigned to Product X?
Greenwood Company manufactures two products—15,000 units of Product Y and 7,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z: Activity Cost Pool Activity Measure Estimated Overhead Cost Expected Activity Machining Machine-hours $ 227,700 11,000 MHs Machine setups Number of setups $ 153,900 270 setups Production design Number of products $ 91,000 2 products General factory Direct labor-hours $ 257,000 10,000 DLHs Activity Measure Product Y Product Z Machining 8,700 2,300 Number of setups 60 210 Number of products 1 1 Direct labor-hours 8,700 1,300 3. What is the activity rate for the Machining activity cost pool? (Round your answer to 2 decimal places.)
Greenwood Company manufactures two products—15,000 units of Product Y and 7,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z: Activity Cost Pool Activity Measure Estimated Overhead Cost Expected Activity Machining Machine-hours $ 227,700 11,000 MHs Machine setups Number of setups $ 153,900 270 setups Production design Number of products $ 91,000 2 products General factory Direct labor-hours $ 257,000 10,000 DLHs Activity Measure Product Y Product Z Machining 8,700 2,300 Number of setups 60 210 Number of products 1 1 Direct labor-hours 8,700 1,300 11. Using the plantwide overhead rate, what percentage of the total overhead cost is allocated to Product Y and…

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